Has London become a hub for laundered Russian money?
Over the three decades since the fall of Soviet Union and the economic chaos that followed in Russia, many of those who became rich needed a safe heaven for their new-found wealth, and London became just that.
Gradually, London earned the nickname "Londongrad" as it emerged as the preferred destination for cash flight from Russia, reports BBC News.
For all latest news, follow The Daily Star's Google News channel. Following Russian President Vladimir Putin's order to deploy troops into eastern Ukraine, British Prime Minister Boris Johnson announced a set of sanctions against Russia.
The UK government has already been under pressure to tackle the inflow of wealth, especially "dirty money", from Russia.
"I'm very open about the fact that for too long London has been the place that people have come to wash dirty money," British Home Secretary Priti Patel told BBC.
UK's Russian connection
Russian immigration to the UK is nothing new since the Revolution of 1917, BBC reported.
Later, during World War 2, many Russian prisoners of war (POWs) escaped Nazi Germany to settle down in the north of England.
Today, many Russian immigrants in the UK are in voluntary exile, especially those who upset the Putin regime in some way.
Many professionals and entrepreneurs from Russia started their own businesses in the UK entirely free of any previous political or commercial connection, BBC reported.
Cultural traditions of the two countries -- which share a mutual respect for each other -- have grown strong, reciprocal and enduring over time.
How much Russian wealth is in the UK?
Transparency International has so far identified UK property worth at least £1.5 billion that are owned by Russians -- either accused of financial offences or having alleged ties to the Kremlin, BBC reported.
A significant volume of Russian, or Russian-linked illicit wealth in the UK is either spent on things like luxury property, cars and school fees, or as donations to cultural institutions, according to a UK Home Office report.
Information on names of individuals and companies owning properties in the UK is often difficult to collect.
According to the Overseas Company Ownership database for England and Wales, only four out of 94,000 properties with an overseas company being listed as the registered legal owner have been found to be Russian.
However, more Russian individuals may have purchased properties using offshore companies in places such as the British Virgin Islands to launder their wealth.
According to researchers, of the more than 700 offshore companies that own properties in the UK, Russian nationals owned about five percent.
According to a BBC report, Russian wealth underpins Premier League football clubs, Scottish country estates, the Waterstones bookshop chain, the London Evening Standard, the extension of Tate Modern, among others.
What makes UK an attractive destination for Russian investors?
Russians have long considered London as a popular destination to settle in, or to purchase property and make investments, BBC reported.
The UK's Tier 1 (Investor) visa scheme -- often dubbed "golden visa" -- offered permanent residency to the rich who could invest £2 million or more in the UK.
Since the "golden visa" scheme was launched in 2008, so far 2,581 investor visas were issued to Russian citizens, until the UK government scrapped the visa scheme on February 17 this year.
At the London Stock Exchange, Russian companies have raised large sums from share sales.
UK government's actions so far
The UK government in 2018 introduced Unexplained Wealth Orders (UWOs) -- a mechanism that allows it to confiscate property without first seeking a criminal conviction, putting the onus on the individual to reveal the source of their wealth.
However, UWOs have been used just four times since 2018, and in only one of those cases saw the property being surrendered, BBC reported.
Another tool -- the Account Freezing Order (AFO) -- allows British courts to freeze funds suspected of ties to criminal activity, and has seen more success compared to the UWO.
The UK government also has plans to fight money laundering through a comprehensive register of individuals who ultimately own or control property in the UK and benefit from it, according to the BBC report.
Introduction of an Economic Crime Bill in the next parliamentary session is also on the cards, UK PM Boris Johnson hinted.
The UK government is also likely to widen its existing sanctions on Russia.
According to the UK Foreign Office, the new measures will allow the UK to act in unison with the US and other allies to freeze assets and ban travel for individuals linked to the Kremlin.
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